CMS Should Improve Its Policies and Procedures for the Oversight of States’ Reported Medicaid Expenditures to Better Protect the Financial Integrity of the Medicaid Program
Learn how the AI-generated research projects were createdOverall Conclusion
CMS did not consistently follow its policies and procedures for overseeing States’ CMS-64 expenditures and its processes for deferred payments and disallowed expenditures require improvements to protect Medicaid financial integrity.
Source Document
Audit Scope
Audit covered CMS’s oversight of States’ CMS-64s for the quarter ended March 31, 2023, including a nonstatistical sample of five States and review of unresolved deferrals and disallowances.
Key Findings Summary
CMS did not consistently follow its policies and procedures related to the oversight of Medicaid State expenditures reported on the CMS-64. Specifically, CMS’s quarterly review work papers for five selected States that we reviewed were not always clear, accurate, or consistent enough to validate that its analysts thoroughly completed all procedures outlined …
CMS’s policies and procedures related to deferred expenditures did not adhere to the timely resolution timelines set forth in Federal regulations, resulting in deferred payments remaining unresolved for years.
CMS’s policies and procedures related to tracking of disallowed expenditures need improvement to allow for more accessible and accurate reporting of disallowed payment information.
AI-Assisted
AI Scope Summary
Objective: assess CMS adherence to its CMS-64 oversight policies; scope: review of five States’ CMS-64s for the quarter ended March 31, 2023 and evaluation of unresolved deferrals and disallowances; conclusion: deficiencies in documentation, deferral timelines, and tracking indicate significant internal control weaknesses that could affect Medicaid financial integrity; this provides a template for future Medicaid audits.
AI-Generated Insight
The OIG identifies multiple deficiencies in CMS oversight of CMS-64 expenditures, including inconsistent review documentation, deferral resolution delays, and incomplete tracking of disallowed payments, and proposes four actionable recommendations (training, alignment of deferral timelines, clearer responsibility assignments, and a required status-tracking step) to strengthen program integrity.
Audit Objectives
Determine whether CMS followed its policies and procedures in the oversight of Medicaid State expenditures reported on the CMS-64 and whether the policies and procedures were sufficient to protect the financial integrity of the Medicaid program.
Audit Findings (3)
CMS did not consistently follow its policies and procedures related to the oversight of Medicaid State expenditures reported on the CMS-64. Specifically, CMS’s quarterly review work papers for five selected States that we reviewed were not always clear, accurate, or consistent enough to validate that its analysts thoroughly completed all procedures outlined in its Review Guide.
CMS’s policies and procedures related to deferred expenditures did not adhere to the timely resolution timelines set forth in Federal regulations, resulting in deferred payments remaining unresolved for years.
CMS’s policies and procedures related to tracking of disallowed expenditures need improvement to allow for more accessible and accurate reporting of disallowed payment information.
Recommendations (4)
Develop and implement additional training for analysts to improve the clarity, accuracy, and consistency of their documentation for reviewing CMS-64s.
Revise its policies and procedures related to deferred payments to align the deferral resolution timelines with Federal regulations.
Modify its policies and procedures to specify which CMS departments are responsible for tracking and resolving disallowed payments.
Modify its Review Guide to include a step that requires analysts to determine the status of disallowed payments.